KUALA LUMPUR: Telekom Malaysia Bhd (TM) has set a new medium to long term business direction to transform into “New TM” and help turn around the company after challenging 2018 which saw its net profit plunged to its lowest level since listing.
Acting group chief executive officer Imri Mokhtar said TM will focus on accelerating services convergence - selling all of its product and services under one brand, unifi - and at the same time further tap on industries that aim to realise their full digital potential.
As such, Imri said the telecommunication company (telco) will continue to allocate around 18 per cent of its revenue for capital expenditure or RM2.13 billion for this year.
“We took a hit in 2018. The changing landscape has resulted in the need to transform. The transformation is very much needed and timely.
“The New TM would put us on a stronger financial position in the medium to long term,” Imri said in an interview recently.
“The strategy to accelerate convergence remains and will be strengthened into New TM that at the same time reinforces customer centricity leading towards Digital Malaysia,” he added.
Imri said the telco sees more growth opportunities in TM One, banking on digital aspirations of industries such as banking, education, defense and security, public shared services, real estate, health and oil and gas.
“We aim to create value for businesses heading towards Industry Revolution 4.0. We will be bringing connectivity and digital infrastructure for them as we help elevate the whole Malaysia into a digital nation.
“It is the connectivity or the physical wireless and fixed line infrastructure that underpins all other digital infrastructure and services such as big data, digital payment, digital ID, internet of things and smart city,” he added.
unifi currently contributes about 45 per cent to TM’s revenue followed by TM One (35 per cent) and TM Global (16 per cent).
Imri does not rule out the possibility of TM One overtaking unifi as TM’s biggest revenue contributor in the years ahead due to its growth prospects.
TM recorded a net profit of RM153.2 million for the financial year ended December 2018, down 83.5 per cent from RM929.7 million in the previous year, due to the change in operating landscape, but expected a better year in 2019.
Its revenue dropped 2.2 per cent to RM11.82 billion compared with RM12.09 billion previously.
In the short term, Imri expects TM's revenue to post a single-digit drop this year while earnings before interests and tax will be higher than 2018 as the industry continues to be challenging.